Why classification decides how useful the forecast is
A forecast is only as good as the way its flows are grouped. A "miscellaneous" line can't be estimated, and it can't explain why cash drifted. The chart of accounts doesn't work for this either: it records when an expense or income is accrued, not when money comes in or goes out.
FLIQO separates the level at which cash is planned from the level at which it's reported, and lets each organization define both.
Liquidity items: the level you plan at
A liquidity item groups receipts or payments of the same kind that recur with a recognizable pattern: cash sales, payroll, domestic suppliers, debt service. It's the level of detail at which cash is forecast, estimated and measured against what actually happened.
That's why each item has its own settings: whether it takes part in automatic forecasting and at what frequency, its tolerances for matching actuals to estimates, and its role in the liquidity band. Having dozens or hundreds of items is normal, and they get adjusted as the business changes.
Classifications: few and stable, for reporting and consolidation
A classification groups many liquidity items under one financial nature: operating income, operating expenses, investment, financing. There are few of them, typically five to fifteen, and they rarely change.
They stay the same across the whole organization. That way cash can be read by concept across the whole organization, even when each company has its own liquidity items. In the forecast matrix, one button switches from item-level detail to the classification summary.
Liquidity hierarchies: the same data, read in different ways
Treasury wants collections shown apart from payments; management wants commercial against administrative. Those are two readings of the same movements, and both have to add up to the same total. A liquidity hierarchy is each of those readings.
- Receipts and payments at the root, fixed, so no subtotal ever mixes what comes in with what goes out.
- Branches named after your business, nested as many levels deep as you need.
- Liquidity items as the leaves, each in exactly one place in the tree and on its own side. The system enforces this, so subtotals never add up to more than the total.
Anything not yet placed shows up as "Unassigned" and still counts toward the balance, so a half-built tree is already useful.
A hierarchy can belong to one company or be shared by several. The shared one sets the structure and each company places its own items in it. Since every movement also carries its department and area, the same structure works for reading cash across the whole organization or for a single unit.
Hierarchies also apply to the past, even one created today. Reorganizing one publishes a new version and keeps the previous one.
What shows but doesn't add up
Some items are there for information without moving the balance, such as a flow worth keeping in sight that isn't the company's cash. They're marked as informational: they appear in the matrix, in their own section, and stay out of the projected balance.
Others are marked as portfolio items by availability (on demand, term or restricted) and feed the investments view.
Bank movements that arrive classified
When a statement is loaded, classification rules assign each movement to its liquidity item. A rule combines conditions on the description, amount, currency, date, account, account type and counterparty, and rules run in the priority order treasury sets.
If no rule applies, the movement takes the fallback item of the account it landed in (the payroll account goes to salaries), then its counterparty's, and if neither exists it stays unclassified for a person to review.
Each rule can have an effective date range, and it can be switched on or off without deleting it.
The counterparty is recognized automatically
Before the rules run, FLIQO looks for the counterparty's tax ID in the movement's description, in each country's format, and matches it against the counterparty register. That way a rule can use the customer or supplier as a condition, and each counterparty can carry a suggested item.
Every rule is accountable
The rule list shows, for each rule, how many movements it classified in the last 30 days and what share nobody had to correct, with a traffic light. When someone changes the classification of a movement a rule assigned, it's logged as a correction. A rule that starts failing, for example because the bank changed its description, gets noticed before it muddies the month.
"Unclassified" is a starting point
Every organization starts with everything unclassified, and FLIQO works that way from day one. Classification gets refined over time, as treasury defines items, rules and hierarchies.
Frequently asked questions
Can I use my chart of accounts?
It can be a starting point for defining items, but a liquidity item isn't a ledger account: it describes when money comes in or goes out, not when it's accrued.
How many items should we have?
As many as it takes for each one to group flows of the same kind. An item that mixes different concepts can't be estimated well. Classifications and hierarchies are there for reporting at a higher level.
What happens to history if we reorganize the structure?
Nothing is lost. Forecast snapshots are stored at item level, so any hierarchy, even a new one, can be applied to earlier months.
Does it work for a company with several areas, or for several companies?
Yes. Within a company, every movement carries its department and area. Across companies, shared classifications and hierarchies let you read them together even when each one has its own items.
Do the rules replace treasury's judgment?
No. They classify what's repetitive and leave the doubtful cases for a person. Treasury decides the rules and can correct any classification.